China Reiterates Gradual Stance on Loosening Yuan Controls
Beijing has no immediate plans to announce full capital-account convertibility of currency
China reiterated Wednesday that further steps toward opening up its capital account with a fully convertible yuan would be taken only gradually.PHOTO: BLOOMBERG NEWS
June 17, 2015 3:34 a.m. ET
BEIJING—China offered a reminder Wednesday that it plans to lift capital controls gradually, even after it hosted International Monetary Fund officials this week who were looking for indications that Beijing will loosen curbs on its currency.
China has no immediate plans to announce full capital-account convertibility of the yuan, a senior Chinese foreign-exchange regulator said Wednesday. Such yuan convertibility would allow freer cross-border fund flows for financial transactions.
“Capital-account opening will be a gradual process,” Wang Yungui, a director of the State Administration of Foreign Exchange, said at a briefing.
Currently, the yuan is convertible on the current account, which covers trade, but there are still some restrictions under the capital account, which covers investments such as stocks and bonds and factories.
In recent months, Beijing has taken steps to open up its capital account. It has introduced a stock link that gives Hong Kong investors access to the Shanghai stock market. The country has also worked to increase foreigners’ access to local investments and Chinese access to those abroad.